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Your Business

News/Business. A focus on issues facing small business in the United States.

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00:30:00

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San Francisco, CA, USA

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Comcast Cable

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Virtual Ch. 787 (MSNBC HD)

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mpeg2video

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ac3

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1920

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1080

TOPIC FREQUENCY

Us 14, Dallas 4, Christy 4, Laurie 3, Joanne 3, Miami 3, Nasal 2, China 2, Craig 1, Brad Harrison 1, Alfred Edmond 1, Kyle 1, J.j. Ramberg 1, Daniel 1, Joanna 1, Yesto Inc. 1, Tylenol Bottle 1, Multimedia 1, Brad 1, Bhv 1,
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  MSNBC    Your Business    News/Business. A focus on issues  
   facing small business in the United States.  

    February 17, 2013
    4:30 - 4:59am PST  

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[ tylenol bottle ] me too! and nasal congestion. [ tissue box ] he said nasal congestion. yeah...i heard him. [ female announcer ] tylenol® cold multi-symptom nighttime relieves nasal congestion. nyquil® cold and flu doesn't. ♪ many hot dogs are within you. try pepto-bismol to-go, it's the power of pepto, but it fits in your pocket. now tell the world daniel... of pepto-bismol to-go.
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you have a great new product and you know people want to buy it. so, how do you bring it to market? follow two women as they go through the process of making
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their business viable and profitable. we'll have that and more coming up next on "your business." small businesses are revitalizing the economy and american express open is here to help. that's why we are proud to present "your business." on msnbc. ♪ hi there, everyone. i'm j.j. ramberg. welcome to "your business," the show dedicated to giving you tips and advice to help your small business grow. todays's story is for anyone who's had an amazing idea for a new product, but has no idea how to bring it to market.
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we asked the founders of texas-based locker looks to help us out. they took us step by step along their path and explained how they turned a clever creation made of construction paper and scotch tape, into a multimillion-dollar business with fashionwide distribution. -- nationwide distribution. turning a clever idea into a marketable product can seem as uncertain as the spin of a wheel on a children's board game. but right at the start these two dollars mothers, joanne and christy, didn't even seem like players. >> this was the first time we ever did this. it was just a complete -- a lot of cute stuff out there and so christy went to work and came up with some concepts and here we are. >> it was things i glued
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together in my kitchen at the table. this was an example of a little bin that was basically just cardboard paper that i glued together. >> their daughters loved these homemade school locker decorations and so did their friends. >> on the first day of school the phone started ringing from other parents saying, where did you get that stuff? we want it. how do we get it? >> we realized there's a market for this. there's nothing out there like it and we should look into this as a business. >> they knew they couldn't do it themselves, and so their first step was to get some help. they met with consultant kyle priest of dallas based crown partners. >> if you feel you've come up with the next great idea and not sure what to do it can look like a mountain to overcome. but one of those things you do one step at a time. >> i was a little afraid to call him. wow, really even sit down with us. i called him and he met with us. >> we worked more on the tenants of the business and goals and put them into a plan structure. i think sometimes people make
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the mistake of grabbing a template and completing it to create a business plan and they forget the human side of things and realities of how to structure a plan that they can live with. once we have the business plan in place and the brand identity solid it was time for them to get into sales mode. >> their next move was to head for the dallas market center. robin wells is one of the executives in charge. >> oh, yeah. if you create a product and want to take it to market there are several ways. the age-old way of bringing it to a trade show, showing as many people as you can and then finding someone to help you sell it, that's what goes on here ten times a year. >> when we came to the dallas market, we were overwhelmed by how much stuff was here. we were pretty clueless but one of the advice that we did get was try to find a manufacturing rep or a sales rep that can distribute your products and that has relationships with retailers. >> as they walked through the trade show, they found a manufacturer's rep listed on the fourth floor. without an appointment, and
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without any referrals, they took their chances and asked to speaks to the owner of dallas-based diverse marketingp. >> they just came up to my door and asked to speak with me and they said that they had a great idea on this little box they were carrying. what's it all about? christy told me, i can't tell you what's in the box. >> he said, i don't know how i can help you if i don't know what idea is. we were fearful about disclosing, you know, any information and so that's when he said, you know, well, have you heard of an nda? you know, we could sign one of those and you could show me your idea. >> the next move for us was, we had some initial meetings and we had a retailer come in that we had good relationships with, hastings, out of amarillo and showed it to her and she goes, i think this is great. i want it to do an order. i go we haven't made it yet. i still want to give you an order. she wrote us a nice order and,
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you know, she left and christy and joanna said, i guess we have to make it now. >> with a business plan in place and major retail order in hand the next step was manufacturing the products. they contacted ray's son, a chinese manufacturing broker and owner of dallas-based china advantage. >> we are the bridge between idea and the product. so if we want to turn the idea to real production in the first stage is you have to give us a design, you have to give us a drawing. >> ray was willing to work with us at that point. not everybody would. some of the factories want you to have a certain volume, certain knowledge, certain business, already established. ray was going to take us from the start and walk us through and hold our hand and say, you guys are new, we can start with small quantities, we can tweak this. >> and we had to decide how much of the product we wanted to get
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made, then he put his team together to source all the different components of the product and came back to us with a price. >> with ray's help the factories in china were all lined up. while the retailers were waiting to receive their orders. the next step, select a fulfillment company to do the receiving, packing and shipping of the merchandise. that's where they landed in serious trouble. >> well, we tried to do due diligence. we weren't that educated about what criteria we should look for in a ship unfortunately, it was a complete disaster and they shipped about 80% of our product incorrectly in that first year. it was very tough year for us. >> those shipping errors nearly cost them the business. but they got back in the game when they reconnected with another shipper. craig clay of maryland based total biz fulfillment. >> i don't know what happened to them. all i can tell you, if you don't have a good fulfillment company in place, is you're customers
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could receive the wrong merchandise, might not receive it in a timely manner. the way they receive it may be just look like it's thrown in a box and it's damaged by the time it gets to you. >> if we had it to do over again we would look for a shipper that was accustomed to shipping to the type of retailers we sell to. >> with their fulfillment service in place, joanne and christy landed on their first goal. their products hang on retail store racks across the country and the two are ready for their next move. >> the path from having an idea to getting a product into a store can be a perilless one if you don't know how to navigate it. let's turn to folks who know the process well. joining us is laurie, the co-founder of book leans, a company that makes fashionable and functional binder covers. alfred edmond, senior president, multimedia at large for black enterprise and brad harrison is the founder and ceo of bhv, business development firm with a
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venture capital fund to support early stage companies. great to see you guys. >> thank you. >> good to be here. >> laurie, you heard about these women. >> yes. >> and had an idea and followed their same process, right? >> i did. i did. we had a concept and then we had to develop a business strategy from there. and so we decided to do a little bit of research on-line and there i stumbled across locker lookz and their success story. >> you did the best research, found someone who did the work for you. >> i sure did. >> you must see this all the time, brad. you invest in early stage companies. people must come and say i have this idea, i know people are going to buy it what do i do now. >> yeah. i mean i think laurie's idea is probably the best thing which is find a plan that's worked, look at where they've had success and where they've had trouble and then replicate it and improve upon the processes. as long as you have a good product vision and you have aidentified a market that's a good market you should have a lot of success. >> a great product is not a business. so many people get stuck,
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they're in love with the great product and everybody tells them they love the product but scaling that product up to the point where it can be distributed through wholesalers or retailers, that's a whole different thing. and what laurie has done and the example in the segment did, was figure out how do you scale from a great idea, great product, to distribution, manufacturing, and fulfillment and unfortunately a lot of people who are passionate about their product get bored and distracted when they go through the other aspects. >> you didn't go to the dallas market? >> we were introduced at diverse marketing. when we had gone to the toy preview i had the privilege of meeting joanne and christie and at that point they took me through all of their triumphs and tribulations. >> do you work with the same people they do? >> we do. >> if someone wants to follow the same path, but can't work with the same exact people, how do they know if they're working with the right people? >> i think the key to anything is great business partners. the failure of most businesses
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are having bad business partners and their stumbling block was a result of picking a bad business partner. you have to understand what the key variables are that you want that business partner to deliver. in their case they needed a partner that was used to fulfilling those products to specific retailers. so you just have to understand what those variables are and pick your partners based on that. >> you want to look at referrals. you want to pick people who have done successfully what you want them to do for you. we don't know what the problem was with the original fulfillment provider, but you want to find somebody that has a proven track record to do the kinds of things you need them to do. >> actually, that's the best case scenario for laurie is to find an adviser or mentor like the two women that had just gone through it, who can help her avoid this stumbling blocks and give her the guidance and make introductions. >> and how do you find it? this all makes a lot of sense, but i talk to people all the time, you know, some women in the park has a great idea, she doesn't even know where to make the first -- >> you have to get out there and
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there's something said about well, we were reluctant to share our idea because we didn't want to get stolen or taken. the truth is you can't get from here to there without going to conferences, without going to dallas market, without going to the toy expo or black enterprise entrepreneur's conference because the other pieces of your puzzle are held by other people and you have to -- it's a nondisclosure agreement signed but recognizing sharing your idea an getting help bringing it to market is critical and you're not going to have all the answers by yourself. >> were you scared to share your idea? >> yes. we were absolutely nervous to do so. but then, you know, we also realized it's important that in order to get this to market, we have to disclose it. we have to build relationships. that's probably one of the biggest lessons we have a learned is networking. it's amazing how much knowledge you can gain in a ten-minute conversation with somebody at a trade show. >> absolutely. >> they help you identify the challenges you could potentially face. how to avoid them.
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best case scenario. >> when you're first starting out you don't know the questions to ask and so you need to talk to people. all right. congratulations on your product. >> thank you. >> looks great and thanks for the advice on this. >> we've been talking about what it takes to get your product on to the shelves of major retailers like walgreens and target. well, not long ago, we spoke to representatives from those stores as well as a california business owner who successfully made his way through that process. >> started out with 16 items in our store and they now have over 50. >> incredible brand an we're so excited to have them as a partner. >> walgreens and target are both saying yes to yesto inc. walgreens vice president shannon curtain and target vice president dusty tucker jenkins say their respective customers are big fans of yesto carrots,
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cue bum bers and blueberries. >> it had the benchmarks it needed to bring it in line. it was also the customer following he had developed. the co-founder of san francisco based yesto, says that getting his organic skin and hair care products into major retailers was a coup. not even he could contain his excitement at first. his reaction was something like this. >> can't say that on television unfortunately. it was oh beep beep beep. early on the 5-year-old company decided to approach larger retailers despite its humble beginnings. with a staff of about 25, working with five american production facilities, yesto currently supplies products to 28,000 stores worldwide. but getting to the point of pitching to prospective partners was a challenge. >> we had to scramble. it was hard. we had a rough plan. >> yesto got its big break after
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sinking plenty of time and money into trade shows. they got a 30-minute pitch meeting at walgreens that turned into a few hours. >> we wanted that presentation to be a presentation which had no questions at the end. the only question we wanted them to ask is when can we have it. >> while touting yesto was easy, answering questions wasn't. he says retailers always want to know about a vendor's potential. >> at the end of the day the retailer wants to know are you bringing incremental people to my store and how are you going to make sure that they buy your product versus somebody else's. >> after an on-line trial and offer for shelf space at thousands of stores, yesto needed to ramp up production and fast. that was by far one of the trickiest parts of working with a major outlet. unlike walgreens, yesto used a different approach when introduced it itself to target. >> when we first met with target, we went through a broker. and that broker adds a certain
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level of credibility to what you're doing. >> at that point yesto was better prepared. the company had already grown to satisfy increased demand. leaf her found differences among retailers. he learned that each vendor gets its own deal. they're never the same. >> the relationship that you have with your mom is different than what you have with your best friend and same thing here. >> it's important we have open lines of communications, that we understand what they're expecting from us and in turn that we understand or that they understand what we're expecting from them. >> even though a vendor may land a major deal, he says they must push to keep partnerships thriving and you always have to think about money. >> most people believe you get into 5,800 stores, multimillion-dollar orders all of a sudden you're made. you're done. unfortunately, in those first years you're putting all that money back? >> he believes small business owners like him may want to rethink their major league plans until they get their minor
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league affairs in order. >> we need to know what products are going to do better and worse. by starting at smaller retailers it gives you a significant advantage as you go into these larger retailers to make sure that you do get it right. >> when we come back. how to draw attention to your business using social media. and we'll talk about the right way to negotiate. think value, value, value. we've all had those moments. when you lost the thing you can't believe you lost. when what you just bought, just broke. or when you have a little trouble a long way from home... as an american express cardmember you can expect some help. but what you might not expect, is you can get all this
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with a prepaid card. spends like cash. feels like membership. some of us are born negotiators, most of us aren't. for so many people it's intimidating and they don't really know where to start. which is why stu taylor is here today, the host of four nationally syndicated business radio shows and entrepreneur and going to give us tips on how to get the best deal in a negotiation. great to see you, stu. >> great to be here, j.j. >> one of the things you talk about is compromise is key. should you go then into a negotiation in the back of your mind thinking okay this is where i'm willing to compromise? >> well, you should go into a negotiation thinking that the ultimate goal number one is to know what you want to do, you know what the other person wants to do, and you know what you
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have to do to achieve your goal. the answer is, reaching a resolution to achieve your objective. negotiation is an interesting process, but it has many faces. i used to do professional boxing broadcasting and boxers, they say, fighting is about styles. compromise is about styles. no two negotiations are the same. >> which makes this next idea interesting. determine what motivates. because you may not know going into a negotiation exactly what's motivating the other side. you may have an idea and it's important to research that. but once you understand that and you can have a discussion about it, perhaps there are compromises you can make that you don't really care about, but will make them happy? >> exactly. you just said it. it is value added. every time i go into a negotiation i'm thinking, what kind of value can i give the person on the other side of the table. but you have to understand what it is a person wants. take an example, you're happily married, i assume, and you think, how often in every
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marital relationship does the man not understand the woman and the woman understand the man because we really don't get at the needs. you have to define what it is that the other person wants. it may not be money. some people -- ego -- >> hopefully with your husband or wife it's not. >> there are different reasons that motivate people. >> but understand their motivations. should you throw out the first price or not. the question we get the most. >> it's a great question. the answer is i don't mean to be diplomatic here, the answer is yes, and no. the only time you should really throw out the first price is if you are in firm control of a negotiation and the information about the other person and you know where the marks are. if you don't and you're caught unarmed and you have to feel your territory. but there are a couple of ways to do this. there's anchoring. there's anchoring at a low end. for example if a home is on the market for 500,000 and i want to negotiate a deal i may really risk it if i really want it. the question is how bad do you want it.
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if i offer 100,000 i may get thrown out of the negotiation. let's take the opposite side. the house is offer at 500,000. the housing market is hot. i'll come in at 550,000 and walkway with a deal that everyone wins. safe way to approach it is in increments. if you're unsure of where you're going and you don't want to alienate someone, feel your way up the line so you downturn someone off and you build up to the point you want. going to the negotiation knowing how badly do i want it and at what price will i settle. >> got it. then you mentioned this a little bit before the value you'll provide and in some ways the value provad may not cost you anything. >> the value provide -- here's a perfect opportunity and you can construct any one of a number of scenarios. i may have something of no value to me, a lot of value to you and vice versa.
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you may have something that's a lot of value to me. if i have someone who i know is an avid book reader and i happen to own a warehouse full of 1,000 books maybe i'll bring them seven or eight, ten books and inject it in the conversation. or if i'm having difficulty in arranging an arrangement and the person i'm negotiating with says i only got 40 minutes my wife is arriving at the airport, i live right near there, why don't i pick your wife up four. bingo, deal. it has nothing to do with the substance of the conversation, it's the value add perception that will help close the deal. >> finally, don't walk away. >> if you're unable to reach an agreement and we've seen the consequences of these with the national hockey league, ridiculous where egos get into it. we saw it with twith iit with t basketball association or congress.
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leave on good terms. don't leave alienating someone or don't walk out of a negotiation. you might permanently damage the relationship. say i would like to think of some things i can do four. let's sit down in three months and come back and negotiate. >> thank you. it's likely that competitors are trying to poach your customers so it's vital to keep your marketing strategies safe. here's five ways to energize sales. one, establish listening posts. up need to under your customer's needs to market effectively to them. get direct feedback from clients and your sales people. two, announce special promotions. people love a good deal so use incentives to draw it home to your company. number three, polish your lead management. ask every new prospect where they heard about your company. and make the leads generated by
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are you on line print and tv advertising trackable. four, enhance your giving. potential customers want to know that you're a good corporate citizen. so consider providing a pro bono service or undertaking a promotional campaign to help your community. and number five, freshen your content. do not let your website become static or boring and make sure each step of your sale process is seamless. time now to answer some of your business questions. the first question is about attracting a specific audience online. >> with the social media aspect we know how to post our product and our offerings with social media, but how do we draw organizations to us through social media? >> interesting, right, because social media isn't about posting your products and your offerings, he's got it exactly backwards. what should he be doing? >> he needs to search out those
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people he wants to engage with and express interest in them. share their information and engage them. posting on social media, just posting your information is like going to a cocktail party and handing out flyers and walking out. you want to go in asking what they are doing, how you can help, sharing information they could find useful and they will gravitate toward your content. >> i think we've talked about this on the show before. social media is about an engaging conversation and that conversation has to be two ways. so you have to seek out the people that you want to engage, and you have to understand what drives their hot buttons and start conversations around that so they get excited and then they will reach out to you because they will start fouling as well. >> it's a real art. we think of social media as free and easy but actually if it's not natural four to have these conversations it's time consuming. you have to think about it. >> very much about what's good socially and you are most
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interested in those people who show interest in you. so if you want generate interest having genuine interest in what other people are doing will get you the attention you want. >> it's just another network just like linkedin and facebook your social media is another way to have a different audience. people that rule on social media are not necessarily people that rule on tv or other places. you have town it's a different aud yes and no and different landscape and you have to find the people that can move and influence the crowds in that space. >> let's move on to the next one. a question about real estate and when you're ready to expand. >> we're now seeking to expand into other luxury markets such as manhattan, miami,. there a. and las vegas. what's the one key piece advice your experts would give me before i seek real estate locations to put my new satellite stores. >> interesting. that's a big decision to go from one store to other stores in
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different cities all across the country. what does she need to think about? >> we always think the biggest thing is density of population around the area and a population that matches the demographic you want to sell to pap lot of people can't afford to open up on fifth avenue or madison avenue but there are a lot of other great spots you can fine in major metropolitan area. you have to find a local broker that understands your business, retail space and where you might be successful. >> that dove tails with what i want to say. don't focus on what they markets have in common. focus on what makes these markets unique because you have to tailor your strategy to each
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individual market. you're really targeting the same demographic. >> what you sneed a very good manager you can trust who knows these places, because your business is changing. when you go from having one store here to a store where you can't be at every single day. >> las vegas is not new york or miami. >> that's why having a local manager from that market that understand the cultural nuance differences of new york,. there a., miami there's cultural differences in the way people perceive the markets. >> someone who comes and trains with you for a while in the store so they know your culture as well. thank you. you guys are a wealth of information every time you come on the show. i appreciate it. want to create dynamic video marketing content for your business? check out our website of the week. brainshark.com helps you track bi